OPENING CALL
Stock futures slipped as a relief rally, sparked by a trade agreement between the U.S. and China earlier this week, showed signs of fizzling out.
Key inflation data and comments from Federal Reserve Chair Jerome Powell will be closely watched on Thursday.
Investors will eye the Producer Price Index, as well as numbers on retail sales and industrial production. Powell is due to speak at 0840 ET.
As the Fed is still assessing the impact of tariffs, the data might not be overly market-moving, Pepperstone said.
Stocks to Watch
Boot Barn jumped 15% on higher earnings.
CoreWeave fell 9.1% on hgher-than-expected capital spending plans.
Cisco Systems rose 4.5% after raising its sales outlook.
DXC Technology sank 15% on worse-than-expetced guidance.
eToro was down 2.7% after jumping on its trading debut yesterday.
Foot Locker jumped 70% after The Wall Street Journal reported Dick's Sporting Goods was close to acquiring it.
UnitedHealth fell 4.8% after WSJ reported the Justice Department was investigating the company.
Super Micro Computer was down 3.4% after a sharp rise in the prior session.
Walmart rose 0.2% ahead of fiscal first-quarter earnings.
Watch For:
Retail Sales for April; PPI for April; Weekly Jobless Claims; Industrial Productions and Capacity Utilization for April; NAHB Housing Market Index for May; Business Inventories for March; Canada Housing Starts for April; Canada Manufacturing Survey for March; Canada Wholesale Trade for March; Walmart 1Q earnings
Today's Must Reads / Top Stories:
- First-Time Home Buyers Are Struggling. That's Bad News for Builders.
- EU Sees Signs That Trade Talks With U.S. Are Speeding Up
- A Fast-Growing Chicken Chain Uses AI in Quest to Become a Household Name
MARKET WRAPS
Forex:
The dollar fell amid speculation that President Trump could seek agreements with other countries to devalue the dollar as part of trade deals.
Reports that the U.S. and South Korea discussed exchange rate polices last week "should be enough to set a few alarm bells ringing" and clearly did given the dollar's negative reaction, Pepperstone said.
If the Trump administration was able to engineer a weaker dollar through deals with other trading partners, the Fed is unlikely to cut interest rates given the prospect of higher import costs, he says.
Sterling rose against the dollar after data showed accelerating U.K. economic growth.
The U.K. economy grew 0.7% on quarter in the three months through March following an expansion of 0.1% in the previous quarter.
The data were skewed by a huge rush of exports ahead of the imposition of U.S. tariffs in April, Pepperstone noted.
Bonds:
Treasury yields were largely flat, stabilizing after slight increases on Wednesday.
However, they are expected to remain under selling pressure due to an improving economic outlook, ING said.
"Since the weekend [tariff] agreement with China, we've turned bearish on Treasuries."
The agreement has caused recession risk to decline, while investors have become confident enough to buy risky assets, it added.
A move higher in yields was therefore overdue.
Energy:
Oil prices slid on concerns of weaker demand and stalling market optimism.
The drop came partly due to a surprise rise in American Petroleum Institute inventories due to lower crude oil exports for the second week in a row, ANZ said.
Monday's market rally on optimism around a U.S.-China trade deal has also started to peter out.
Meanwhile, President Trump has kept up pressure on Iran over a nuclear deal, ANZ added.
Metals:
Gold futures slumped on easing safe-haven demand, and investor positioning ahead of U.S. data.
The market is pricing in around 50 basis points of interest-rate cuts over 2025, which would be a boon for gold.
Copper fell on some profit taking following the base metal's recent price surge.
However, copper prices may remain supported in the near term as the U.S.-China trade deal will likely drive demand higher, Maike Futures said.
TODAY'S TOP HEADLINES
Geely Automobile's Profit More Than Tripled on Record Sales
Geely Automobile's first-quarter net profit more than tripled, thanks to record sales and improvement in profitability, as it strives to make headway in China's increasingly competitive electric-vehicle market.
The company said Thursday that net profit more than tripled to 5.67 billion yuan, equivalent to $786.6 million. Revenue for the quarter rose to 72.50 billion yuan from 58.23 billion yuan a year earlier.
Boeing, GE Aerospace Get Qatar Airways Order After Saudi AI Tech Deals
Boeing and GE Aerospace received a $96 billion order from Qatar Airways as President Trump looks to boost investments in defense and aircraft in the Middle East after reaching artificial intelligence and tech agreements on Tuesday.
The order, announced Wednesday, includes up to 210 American-made Boeing 787 Dreamliners and 777X aircraft and more than 400 GEnx and GE9X engines from GE Aerospace. The sales figure doesn't appear to include discounts of as much as 50% to 60%, which are typical for jet deals.
Dick's Sporting Goods Nears Deal to Buy Foot Locker
Dick's Sporting Goods is nearing a deal to buy Foot Locker for roughly $2.3 billion, according to people familiar with the matter.
U.K. Economy Raced at Start of Year But Slowdown Looms
The U.K. economy outpaced growth in the U.S. and the eurozone in the first three months of the year, though a slowdown likely lies ahead in an environment of rising joblessness and a pessimistic mood among consumers and businesses.
Gross domestic product expanded 0.7% in the quarter through March, figures from the U.K.'s Office for National Statistics showed Thursday. That was faster than economists' forecasts of 0.6% growth, and means Britain outpaced the U.S.-where the economy contracted-and the eurozone, which grew 0.4% over the period. On an annualized basis, GDP grew by 2.9%, the fastest rate since the beginning of last year. The expansion was fuelled by growth in the services sector, which is key to the U.K. economy.
Surge in Australia's Jobs Growth in April Could Trouble RBA
SYDNEY-Australian employment growth in April surged by more than four times what economists expected, which could cast doubt on a widely anticipated rate cut by the Reserve Bank of Australia next week.
Employment jumped by 89,000 in April compared with an expected increase of just 21,000, while the unemployment rate was unchanged at 4.1%, the Australian Bureau of Statistics said Thursday.
New Retail Sales Data Are Coming. Americans' Spending Looks to Have Slowed Down.
After Americans pulled forward many big-ticket purchases in March to get ahead of potential tariff-induced price increases, spending is expected to be more muted in April.
Economists surveyed by FactSet project that overall retail sales gained 0.2% month over month in April, a slowdown from the 1.4% surge in March.
The Fed Wants to Hit Its Inflation Target. Why It Might Not Get To.
As Federal Reserve officials sipped wine and chatted at a conference in sunny California, tension hung in the air-a central bank preparing for a changing of the guard and, potentially, a changing of the mission.
The theme of Stanford's Hoover Institution monetary policy conference last week was "finishing the job," a nod to the Fed's ongoing struggle to bring inflation down to 2% while easing interest rates. But the job, as it turns out, may be unfinishable. And the institution trying to complete it may soon be reshaped.
Five Takeaways From RFK Jr.'s Grilling on Capitol Hill
WASHINGTON-Lawmakers grilled Health Secretary Robert F. Kennedy Jr. in two hearings Wednesday over his cuts of 20,000 employees to his department, vaccines, measles and more. Protesters interrupted one hearing with cries of "RFK kills people with AIDS!"
Ben & Jerry's co-founder Ben Cohen was among several people removed from Kennedy's Senate hearing. Cohen said in a post on X, "I told Congress they're killing poor kids in Gaza by buying bombs, and they're paying for it by kicking poor kids off Medicaid in the US."
Harvard's Magna Carta Copy Turns Out to Be an Original
For 80 years, Harvard Law School believed the Magna Carta it bought for $27.50 was a reproduction.
Now, British researchers think the document is a genuine version-one of a few still in existence.
Refusing to Meet Zelensky, Putin Sends Junior Team for Talks With Ukraine
ISTANBUL-Ignoring Ukrainian President Volodymyr Zelensky's call to meet for direct high-level talks in Turkey, Russian leader Vladimir Putin dispatched to Istanbul a team of junior officials, making it uncertain that negotiations between the warring nations would occur at all.
The Russian team is set to be led by Putin's aide Vladimir Medinsky and deputy defense minister Alexander Fomin, the same men whom Putin dispatched to negotiate Ukraine's surrender in the early days of the war. The last session of these talks occurred in Istanbul in March 2022, and the negotiations fell apart as Russia suffered a military defeat and withdrew its forces from Kyiv and other parts of northern Ukraine.
GOP Tax Debate Gets Testy as Conservatives Fume Over SALT
WASHINGTON-Conservative House members are fuming at some of their Republican colleagues from New York, New Jersey and California, whose insistence on a much larger state and local tax deduction is one of the biggest remaining hurdles to the party's giant tax-and-spending bill.
The current plan, approved Wednesday by the House Ways and Means Committee, includes a $30,000 cap for individuals and married couples that starts phasing down when income reaches $400,000. That is a boost from today's $10,000, but it isn't high enough for lawmakers like Reps. Mike Lawler (R., N.Y.) and Nick LaLota (R., N.Y.), whose negotiations with House leaders on what is known as the SALT cap are expected to drag into the weekend.
Write to don.forbes@wsj.com
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05-15-25 0614ET
